good morning. the march 20,000 the dow on a seven week winning streak kpipt hit the milestone before the end of the year. we'll talk odds straight ahead. >> trumponomics. we'll tell you what he had to say. ready for returns. nation's retailers hoping consumers bring items back and open up their wallets this week. it's tuesday, december 27th, 2016 and "worldwide exchange" begins right now. ♪ good morning and welcome to

"worldwide exchange". on a monday. opposite sara eisen alongside mike santoli. good morning. happy holidays. last week 2016 all week playing the top songs of the year. >> might be the first time i hear some of them. i have to admit. >> so sad. >> we are all over the trending music here on "worldwide exchange". >> let's check in on the global markets first thing this morning. let's take a look. we have a futures i think trading pretty quietly just below, slight lie below fair value on the s&p, the dow. the dow still within hailing distance of the 20,000 mark. made a near approach last week but flattened out. seven straight weeks in a row. take a look at the bond market what it's doing this morning. or do we have global markets >> the ten year trying to come up here. but you're right. 13 points away. >> just 13 points away.

we calculated few cents on each dow but never got there. ten year note yield somewhat higher. 256. we may the high on the yield on the 15th of december about 2.6 and hovered right there as well. it seems like we're pretty much going to hold the highs in the stock and bond yields. >> we have a flood of economic data out of asia. here's a recap. starting with japan, cpi inflation key for japan and it declined again. .4 of a percent. year-over-year in november. economists have been looking for a smaller drop. meantime november household spending in japan decline 1.5% from the previous year. as for the labor picture in the country jobs to applicants ratio rising slightly to its highest level since july 1991. in south korea, a new survey from the central bank showing consumer sentiment plunging. among the reasons a big

political scandal and volatile financial markets. then in china the national bureau of statistics reported by large industrial firms rising 14.5% in november significant jump from the 9 policy 8% increase the month before. their services widening to 25 billion. in a commentary yesterday chinese state news agency said the country will be meeting its growth target of 6.5% to 7% growth this year. there had been some questions about whether the president, some reports from bloomberg was open to going below that growth forecast. >> perhaps they were tolerated or widening the band of what was okay. >> china, i mean, you have to think of how we start this year. the market crashed. currency plunged. it sent the whole global markets into turmoil. things look a bit calmer although there are concerns in the bond market.

>> the question of sort of the debt edifice. not yet spooking anybody. markets in hong kong, australia and new zealand shut for public holidays today. here's the rest of the major markets over there have performed. you see the shanghai is the one in the red. been a little bit of a pattern. been an underperformer. nikkei in japan up fractionally as well as the kospi. in europe we have tuck markets clos -- the uk markets closed today. italy was down earlier on the continued concern about the banks but has come back a bit. >> let's check out oil prices. this morning oil still trading near 17 month high on the price of oil and firmer again this morning. wti 53.25. we're looking at the highs of the year for the price of oil,

up .4 of a percent. brent is up a little less than that. natural gas is getting a boost this morning. as for the u.s. dollar also hovering near 14 year highs as yields remain near their highs. the euro is weaker 104.46 and dollar just a little bit fractionally stronger against the yen as well. the pound weaker. strong dollar. we'll see. still in search of a trend. small moves. for gold on the flip side has been a big loser in the past few weeks and months on that strong dollar. it's up about a percent this morning. so week ahead we're in a phase that gets us into the santa claus rally. the question is was it pulled forward by the trump rally and if it doesn't happen is that a precursor as they say to a bear market like we saw last year. >> last two years that santa claus rally period which technically is define -- last five trading days of the year

plus first two of the new year that would have start this year on friday. friday you had marginally up markets for the dow but past two years that bellwether signal was negative and it led to negative january. i think the rule if you can call it a rule is if there's no santa claus rally so to speak then january struggles. january has been weak three years in a row. i think a lot of questions going into the end of this year arer with in for another replay of that especially when as we just ran through stocks finishing the year at the highs, oil at the highs, bond yields at the highs and gold at the lows. a lot of these markets are at a little bit cyclical extreme. >> dow up 9% since the election. that's the other wild card you have here is the election and this burst of fundamental reasons the market should rally. yes it hasn't happened yet. this idea of sharper tax cuts and less regulation and more

stimulus and fiscal policy has been fuel for the market. >> one of the reasons it's worked is that if you were wrong about all those things you won't know about it for months. can you play the trade while it's in incubation if we get it. if not we'll have a little bit of a struggle. the consumer will remain in focus as retailers deal with returns and gift card redemptions. about 10% of holiday purchases are returned and the rate is higher for online purchases. the majority of those items even the ones bought online are returned to brick-and-mortar locations. that was a surprise to me the return rate so high and mostly happens in stores. >> that's good news for stores, right? means they can buy again. >> running sales. have a chance to actually get them again. >> president-elect donald trump tweeting about the economy and retail yesterday. he wrote last night quote, the world was gloomy before i won, there was no hope. now the market is up nearly 10%.

christmas spending up over a trillion dollars. so, as for the whole thing that's up for interpretation. as for the market he's not wrong. the dow super9%. s&p is up by 5.6%. the trillion dollar spending number i went, i tried to find that. it came from a survey. but got published back in september/october. it was before the results of the election but there is a feeling that consumers may open their wallets a little bit more, their animal spirits have returned, there's this great hope of lower taxes and fact that the election is just out of the way. >> there was definitely -- >> financial journalist trying to fact check that. >> the question is going remain does he want to actually mark to market his job performance on the dow? is that really how you want to go through for four years. trillion dollars in holiday spending, ask anybody in this country what the dollar value of

holiday spending was last year. nobody has any idea. can you claim it, it's fine. >> supposed to be up. >> no doubt. >> but to your point the fact that he's calling the market before he gets inaugurated and taking credit for it, let's see what happens if there's a downturn. >> absolutely. to the day ahead on wall street there are a pair of economic reports on the agenda. the first trading day after the holiday weekend. the kay schiller home price index will be out at 9:00 a.m. eastern. at 10:00 a.m. look for december consumer confidence. we'll see if that confidence affects following the election did take hold. the index jumped to a nine year high last month. in corporate news this morning the european central bank is telling monte dei paschi the italian bank it needs to raise 9.2 billion dollars. that's significantly higher than the 5.2 billion capital short fall previously estimated by the bank. the bank jumped as it experienced large outfloss.

latest statement comes after the italian government approved plans last week to bail out the italian lender. in other global corporate news toshiba is considering booking a loss of hundreds of billions yen on a u.s. power acquisition. shares dropping sharply on the news today. the loss would be for goodwill impairment. toshiba will be forced to boost it's capital base which has been weakened by restructuring steps in the wake of its accounting scandal. >> snapchat is buy iing see imagine media. the start up deal is estimated to be 30 to 40 million dollars. snapchat's first acquisition in israel, see imagine develops technology allowing use towers virtually place furniture that they want to purchase inside their homes right on their phones. report suggesting the company's

highly skilled team was the main acquisition purchase reason rather than that actual technology. some stocks to watch today. iran says it sealed the deal to buy 80 boeing jets for half of the announced price. boeing in a airbus signed contracts to supply commercial airplanes to iran first deal since the international sanctions were lifted under the agreement to curb tehran's nuclear program. add convenience stores to gas stations. uk said the company is pushing the model as a global strategy to boost earnings from more than 17,000 station worldwide. barron's is positive on hd supply. shares are up $10 since election day. more than 25%. it could rise another 16% in the coming year. hd supply could benefit from an increase in infrastructure spending understand a trump administration as it sells building supplies used in nonresidential construction.

>> when we come back. the playbook for 2017. we'll look what could happen in the health care sector, worst performing of the year for the s&p. but first we want to hear from you. what do you think is the top market story of 2016? so many choices. brexit. trump. china. crude oil. we'll read some of your answers on air before the end of the show so please let us know. your top market story of 2016. you're watching "worldwide exchange" on cnbc. bigt the g to wish, xudecember to mb salvente g to wish, get upo $2500 customerash se6 and 20 deor these ter. get see your lexus dealer.

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welcome back to "worldwide exchange". if you're just waking up let's get you up to speed on the market action. u.s. equity futures just a little bit below the flat line. dow jones industrials average looking to lose close to 18 points. maybe put it slightly further below that 20,000 point mark that we've been monitoring for a couple of weeks now. let's take a look at u.s. treasury yields this morning. they were slightly up. there you go. all across the yield curve we have slightly higher yields. ten year note pushing 2.56% just a little bit below year-to-date highs set a couple of weeks ago. seems we might go out on the highs in terms of government yields as well as the stock market this year. turning to oil, we also there, oil prices above $55 for brent, $53 for west texas intermediate. natural gas getting a good bid

on some of that cold weather throughout dunn. now for cold we'll take a look, coming off those recent loss. just a little bit. up 1%. the dollar is mostly calm this morning at 1144 per ounce. >> the ball is set to drop on the new year and you know what that means. cnbc getting out the playbooks to work out what may happen in various sectors in 2017. today we're looking at what's next for health care. to do that here is bertha coombs. >> reporter: repeeling obamacare is easy. the challenge for the trump administration and republicans in 2017 will be coming up with a replacement plan and pulling off a smooth transition. three predictions. first repeal and maintain obamacare. republicans will repeal the aca especially the unpopular individual mandate early next year but replacing it could take a couple of years. in the meantime they will keep

obamacare subsidies and to prevents a collapse of the market they may come up with funding to offset insurers losses. second m and a on pause. with uncertainty surrounding changes to the medicaid and medicare government health programs, insurers and hospitaling will refrain from big mergers in 2017 and instead work on partnerships aimed at bringing down costs. which brings us to more pay for value. hospitals are already feeling the pressure. next year drug makers distributors and pharmacy benefit firms will be on the hot seat to deliver lower prices too. bertha coombs, cnbc business news. in other words it will be a big policy year for health care and i think there's going a real divergence. we've seen it between the hospitals, the insurers and drug makers with diverging fortunes based on any tweet comment or even policy we get. >> it seems like a wide range of

outcomes because people are pretty comfortable with seeing who is the winners and losers. i heard some people point to southeast specialty pharmaceutical companies that have been beaten down, people think there will be prices on drug price and comparing them to what energy stocks looked like at the end of last year. nobody thinks there's a way out. nothing but downward spiral. they look cheap. we'll see if there's any surprises. >> they did get a bid towards the end of last week continuing this idea the market continues to rotate and pick winners and that propels the rally. >> surf through what's been lagging. coming up this morning top political stories including a round up of the latest tweets from president-elect donald trump. he was pretty active last night. >> had a lot to say. first as we head to break here's today's national forecast from the weather channel's meteorologist. >> kind of a rainy start across much of the northeastern cornerer and foggy conditions across much of the south.

fog advisory in atlanta. a lot of rain will just be in the morning hours with sunshine returning by the afternoon. chilly across parts of the north and a storm system in the pacific northwest will bring heavy snow in the cascades. take a look at the temperatures. more records can be expected today across the gulf coast states. cooler in chicago with a high temperature around 32 degrees. our temperatures in the northeast today are going to start out on the warm side but they are going to be calling as that cold front passes in to the afternoon. another warm one st. thereafter, 82 degrees today in miami. going to be a very warm december. we'll be right back.

a developing story they're morning. russia's defense ministry says rescue teams have found the black box from the military plane that crashed in the black sea this weekend. all 92 people are believed to have died after the plane crashed shortly after take off from sochi. passengers included singers from russia's military choir worship is going syria to perform at a new year's concert. japanese prime minister shinzo abe is in hawaii for a historic visit. this afternoon abe and president obama will tour pearl harbor and "uss arizona" memorial. first time a japanese leader has visited the site of the 1941 attack on the u.s. naval base. earlier this year president obama visited hiroshima to honor victims of the atomic bombing in

world war ii. my must read later today is on the significance of this, not just for japan and for president obama, but the message here for president-elect donald trump. >> and the rest of asia. president-elect trump's transition team gets back to work today preparing for a battle to confirm cabinet nominees. edward lawrence joins us live from washington with the latest. good morning. >> reporter: good morning. the president-elect's transition team opened a war room here in washington to help his cabinet picks get confirmed here from congress. the president-elect minimum self may need help to answer conflict of interest charges. donald trump tackles foreign policy and business conflicts as the country awaits more cabinet picks. the trump foundation controversy is creating a stir among critics who believe a conflict of interest is unavoidable. >> with the new york attorney general there will be lots of

people nipping at his heels of this business empire that he refuses to divest from. >> reporter: trump needs to divest himself from his for profit business before he starts working on world affairs. >> friend don't take friends to the security council. >> reporter: problems with israel may be the first problem. the president-elect condemned the united nations again calling it a club for people to get-together. after the u.n. security council passed a resolution condemning israeli settlements. israeli prime minister accused president obama of being behind the resolution. >> when the prime minister of israel makes an allegation that's backed up by 100% evidence. >> reporter: pro arab activists stand by the incoming administration concerns. >> i hope donald trump doesn't act in a precipitous and dangerous way and undo this or try to remove the u.s. from the u.n.. >> reporter: mr. trump says the resolution makes peace in the middle east more difficult. and israel says it will suspend

working ties with countries that it started and initiated this resolution and cancel state trips with countries that voted for it. >> thank you very much for that. in other national news today controversy over the american kidney fund. it's one of the largest u.s. charities helping to pay insurance premiums for dialysis patients. it distributes funds based on need. "new york times" reports the charity resisted giving aid to patients at clinic that don't donate to fund. the fund ceo said it pushes clinics hard to donate but never denied any one assistance. monday night football detroit lions were trying to luck up a playoff berth taking on the dallas cowboys. dallas dominated, scoring six touchdowns. cowboys winning big, 42-21. with the loss the lions are

forced into a one game show unfor their division title with the green bay packers and possible playoff berth. >> you are either in or out. >> did you watch? >> die not. in other sports news, simone biles can add more hardware. she was named as 2016 female athlete of the year. she brought home four gold and one bronze medal from the rio olympic games and is the most decorated u.s. gymnast in history with 19 world and olympic medals. several new arrivals couldn't knock "rogue one." it took in an estimated $96 million over the four day holiday weekend. that brings its two week total to 318 million. film has made more than $500 million around the world. "rogue one" pushed the american

box office past 11 million. other movies performing the best. made "the secret life of pets" debuted with $56 million. >> might be interesting. >> you got kids. it looks good. fun for adults too with the voices. about it any spears is alive and well despite some tweets to the contrary. sony music twitter account was hacked yesterday morning posting tweets the pop star died. bob dill ln sent out a tweet rest in peace spears. dillon and spears are sony artist. the fake tweets were soon removed. sony says its twitter feed was kmd a compromised and apologized. last week the accounts of netflix and marvel.

>> fake tweets, fake news. >> incredible. maybe the tell there was bob dillon would send condolences to brittany spears. interesting. when we come back this morning's top stories including the stocks to watch today as the dow attempts to complete its march to 20,000. what do you think is the top market story of 2016? tweet us at "worldwide exchange". or our own twitter accounts. some of your answers will be read before the end of the show. mike santoli has his pick. surprise market story of 2016. you're watching "worldwide exchange" on cnbc. we'll be right back. his, the stuffhat maers? stak are so gh, the stuf youreaers? how you solvehis? you don't. you paner with firm that ses vernmes ane fortun500, and, can deliver insight person to person,

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good morning. trump rally, can the dow extend its seven week win streak in the final trading sessions of 2016? >>. wall street agenda. consumer and housing set to dominate today's conversation. today's top trending stories including a very fit list of the most downloaded apps. it's tuesday, december 27th, 2016. you're watching "worldwide exchange" on cnbc. ♪ good morning and welcome back to "worldwide exchange" on cnbc. i'm sara eisen alongside michael santoli who is in for wilfred frost. earlier i said happy monday. it's tuesday. >> that's how people feel. >> it's also the last week of 2016.

so all week we're playing the top songs of the year. >> that was only from this year. >> only from this year. yes. played so much. >> the mileage. we'll check on global markets first thing this morning. the futures trading slightly lower most of the morning. we came into the week a little bit of a quiet friday to open up the final five days of the trading year. you see the dow futures, yeah, everything just a little bit slightly below fair value. dow industrial average is a little bit less intense march towards 20,000 but definitely still within one dood dgood day distance. the treasury market some talk stocks outperformed bonds. you may see a rotation out of stocks into bonds by pension funds. no real evidence of that but yields holding steady around 256. >> flood of economic data out of asia. here's a recap. let's start with japan. the consumer price numbers,

consumer price index declining .4 of a percent from last year in november. economists have been looking for slightly smaller drop. household spending in japan decline 1.5% from the previous year. stuck in deflation. as for the labor picture job to applicants ratio rose slightly highest level there since july 1991. in south korea, a new survey from the central bank showed consumer sentiment plunging to its worse level in more than 7 1/2 years in december. one of the reasons, political scandal and volatile financial markets. then in china the national bureau of statistics reporting profits earned by large industrial companies rising 14.5% in november from a year earlier. that was good. significant jump from the 9.8% increase in october. meantime the trade deficit in china in services widening to 25.4 billion in november from 20.9 billion in october. in a commentary yesterday chinese state news agency saying

the country will be meeting its growth target of 6.5 to 7% growth this year. markets in hong kong, australia and new zealand shut for public holidays. shanghai comp in china underperforming down a quarter of 1%. green arrows in japan, the nikkei closing up just fractionally on the back of the weaker yen. south korea had a strong day. as for the early action in europe, uk is closed for a holiday. the day after boxing day observed. wilfred frost will be back tomorrow. the rest of europe is sort of calm in holiday thin trade. got green arrows in germany, italy and france. italy flat watching the banks. >> little bit of a scary headline on the banks yet the overall market has managed to pull it up. >> as they march towards the bail out. >> absolutely. as for broader markets we'll

take a look at it was trading firm. there's a bit of a rally in natural gas. that might help the supposed come back in coal. we'll see if that continues. then to the dollar, also sitting pretty close to its highs and it remains there. it's 104.49 against the euro. that rate is barely above the lows for the euro. the gold be markets may be a little bit firming up from steep losses in the last few months. it's been a give up trade in gold. up almost 1% at a 1144 an ounce. >> the consumer will remain foin cuss this week as nation tease retailers deal with returns post-holiday sales and give card redemptions. about 10% of holiday purchases are actually returned. the rate is even higher for online purchase.

majority of those items are returned to brick-and-mortar locations. the "wall street journal" today puts a positive spin interest for the brick-and-mortar says it gives them an edge online and that is actually people can buy more as they come in to the stores to return. first you thought they had intelligent in the last minute shopping but then amazon started offering two hour delivery. >> i have to believe there's an engineering team in amazon when you go online to return something they are putting a lot of things in front of you. >> not quite the same. . >> there's not that serendipity effect. >> donald trump tweeting about the economy. wrote the world was gloomy before i won. there was no hope. now the market supernearly 10% and christmas spending is over a trillion dollars. >> what do you say? is that accurate? >> i mean it's vaguely accurate in term of the market. the dow being up that much. the russell is up more than that. in terms of there was no hope is

that a veiled slap at president obama who ran twice on hope? but the trillion dollars is kind of this out of the blue sort of dollar figure about holiday spending. all retail spending in this whole three month period or something. >> we tracked it down. as far as we can tell it comes from a consumer survey, predicting the holiday spending will be up 3.6 to 4% passing a trillion dollars. that came out before the election. still there's a feeling that consumers might open their wallet. consumer discretionary stocks are okay. lately they have been hit on concern on import taxes. >> seems to be about bragging reits and fixed on a number for us. now to the day ahead on wall street there's pair of economic reports on the agenda to watch on the first trading day after the holiday weekend. that would be the monthly kay schiller price home index out at 9:00 a.m. and prices hit their highest levels in more than a decade. at 10:00 a.m. look forward to consumer confidence on that hope

confidence note. the index jumped to a nine year high last month. very little in the way of economic data all week. we'll get trade data later and existing home sales. question is does the santa claus rally traditionally happen in the last trading week of the year actually happen this year and if it doesn't does that -- is that a bear signal for stoings january? >> would years in a row if did it not happen. markets down the final five days of the prior two years and then it did lead to a weak january. some of those seasonal rules of thumb haven't worked out that great this past year. january was down yet the year was up. that's not supposed to happen. >> january was the worst start of the year for stocks. >> selling in may didn't work. not very weak in september. doesn't mean these aren't good. i always say these seasonal effects are more climate than weather. they tell the general te

tendencies. >> with this sharp rise since the election, valuations are now even higher. what are they 17 plus. >> 17 plus forward earnings. and it's a high for this bull market. >> there has to be a lot of policy backed up by hopes to and bullishness. >> the earnings growth has come to through. >> where are we? double digit earnings? >> the projection is for mid-teens. >> we'll see. >> in corporate news this morning the ecb is telling monte dei paschi it needs to raise 9.2 billion dollars or euros? it's about the same. this figure is significantly higher than the 5.2 billion capital short fall previously estimated by the bank. the bank's cost jumped as it experienced large outfloss. the italian government approved plans last week to bail out the

troubled lender. >> in other global corporate news toshiba the considering booking a loss of several hundred billion yen on usa nuclear power acquisition made by its westinghouse division. shares dropping sharply on this news. loss is for goodwill impairment. toshiba will be forced to boost its capital base. certainly bad news. the stock down 12% in japanese trade. now to some top trending stories. the tributes honoring george michael dominating social media over the weekend. the singer launching his career with wham in the 1980s, gaining massive success. he had so many hits. i didn't even real swriez it. george, his band made tweeting "heartbroken" at the loss of my beloved friend. madonna taking to twitter saying farewell my friend. another great artist leaves us.

james cordon tweeting i love george michael. >> for '80s kids such as me, you know, prince and george michael, maybe he's not up to prince's threshold in terms of influence, but -- >> did he have so many hits. >> it does bring it back. >> hard to believe he was only 53 years old. so young. it looks like fit bit and amazon echo topping holiday wish list this year. the fit bit rising to claim the number one spot on apple's ios store. amazon alexis app coming in at number four. >> taylor swift giving one of her biggest fans an unexpected christmas gift. cyrus porter a 96-year-old world war ii veteran recently profiled by local news station for his love of all things taylor swift. so the singer getting wind of the story which aired two days before christmas and making a

surprise appearance. she performed her hit song "shake it off" and looking at his world war ii memorabilia and taking a ton of photos. take a look. ♪ >> nobody does it like taylor swift. >> acoustic version of "shake it off." i don't know if my daughter would recognize it. very nice to see. >> come on. she does this. it's savvy. it's smart. she puts it all over social media. she surprised someone i know at a wedding. huge, huge fan someone who had lost their father and tlchs taylor swift taking selfies with them. she loves her fan. coming up today's must read. >> our viewer question this morning.

what do you think is the top market story of 2016? stock markets moved higher since the election and set up named a trump rally. if the market goes into reverse next year when the reality of a trump presidency hits will it be called a trump crash or will he be able to avoid that label? that certainly is one big story of the year. >> i think we'll do with trump dump if that happens. >> trump dump. you heard it first here on "worldwide exchange". we'll be right back.

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welcome back to "worldwide exchange". time for must read. my pick in the "wall street journal," obama's fitting finish. brett stevens skaon obama's forn policy. barack obama's decision to abstain from and therefore allow last week's vote to censure israel is a fitting cap stone of what's left for foreign policy, strategic half measure, underhanded tactics and moralizing gestures have been the president's style from the beginning. israelis are not the only one to feel. the trade iranian's green revolution and heroic protest of a stolen election mr. obama failed to endorse for fear of offending the ruling theocracy.

it's a short piece. to point to. powerful and critical. final line united states abstains what a fitting finish to this ruinous presidency. pretty harsh from brett stevens in the "wall street journal" which has been harsh on president obama specifically on this idea of foreign policy where there is a lot of room -- >> if you dial back to when obama came into office -- there was a feeling the united states run roughshod under bush and he wanted to be less arrogant. >> he won the nobel prize. >> yes. >> just for there being. on that hope. >> where you go from there? interesting another lurch, picking different favored nations and those out of favor. >> a lot of question marks. my pick for this morning is from "the washington post". it's titled trump success handed a great economy. what happens when it goes south?

you can bet then that early in his presidency trump will be touting sorts of government source economic data as evidence of his tremendous success. here's the risk. with economic metrics so strong only one direction the economy can head in the medium turn and that's down. no president truly picks his starting point for the economy and obama certainly benefitted from the economy being in a deep rut when he got there. it's kind of interesting though, this twist on the economic data because trump partially came into power saying look not believing that the economy was any good, believing economic data was wrong and now main he'll endorse saying trillion dollars in holiday sales was somehow a good thing not government data. >> the truth is can any president take credit for an economy. so much had to do with the fed policy, zero interest rates. >> however when you come in saying we think we can get the economy growing 4% to 5% tremendous dollar value growth

you have to deliver. >> a lot say it's overly optimistic. if we see this package of fiscal policy that's done in the right way to the right place, if everything goes right, if corporate tax reform. get that down 20% that could boost earnings significantly. bring $2 trillion back from overseas to the u.s.. >> key word is sustained. >> what happens on trade? what happens to geopolitics. how does that interfere. up next we'll talk to steven wieting. thinks thoughts on the dow's pursuit of the 20,000 level p. our viewer question this morning, what do you think is the top market story of 2016? trump winning the election. we finally have a businessman running the business called the usa. alan says second place goes to bill ackman being so wrong about

so many stocks. i'm not sure if that's the story of the year. >> it is one of them. >> it sure is. stay here you're watching "worldwide exchange" on cnbc. ♪

exchange". futures this morning soft. dow futures are down 18 points. s&p down one. nasdaq down little less than one. in search of direction after seven straight weeks of gains for the dow. joining us to talk about what happens next is steven wieting. the biggest story of 2016 what say you >> brexit, trump. this view towards nativist view. let's focus on ourselves first sort of obvious. what that will mean next year. where cooperation is much more important. these are sort of things that i think are very important. petroleum turn around, two year

deep recession. and, you know, finding, i think, a pretty clear bottom a collapse there after the oil supply boom and now we think a move in the other direction. i think that's pretty meaningful. obviously relationships across the world how trump and china will play together is very important. >> these political shocks happen at least the u.s. election happened as we had an upswing and a lot of global economic indicators. your surprise index is trading at a high. what does it mean for heading in to 2017 because there's a sense in the markets that it really means we have some momentum going but we've had these first quarter short falls in growth in the past few years. >> it poses a question. both in the united states and eurozone you see these five year highs where economic surprise has been strong. u.s. had a third quarter growth rate of 3%. we saw signs out of american economy that we could do better.

we could do somewhat better. before election, before this was ever conceived of. you do have to ask about the seasonality of these issues with prepon derrance ever strong upsides. to what extent has that played out in the marketplace and what if fiscal easing tax cuts, spending are delayed you late into 2017. if that's the case there could be a gap in there performance between cyclical equities. we talked about some risks. trade. >> absolutely. you're seeing very front loaded effects in foreign exchange markets. this is reducing the potency in the rally for international assets. for international investors it's increased appeal for the united states. we're seeing reignition of policy divergence.

this has some pretty strange effects. >> when, though? so far as the dollar climbs higher so does stocks. seem to be nicely correlated. >> that's a nice thing from a u.s. asset perspective but eventually it can create volatility. you can get towards these extremes which can play out and then you finally have a counter trend movement which can be pretty strong. take a look at the japanese yen. maybe it's not on everybody's list but the same incredibly strong easing policy has given us 105 to 117 on the yen. >> a lot of people connecting the dots between where we are on the economic cycle and then potential policy moves. saying well hard to say exactly what it means for growth but seems you might have more inflationary pressures. >> one thing that we've done here is we may have trade in this slow growth predictable durable slow growth world for a

policy experiment. which the federal reserve officials have from time to time whether they say so or otherwise have called for. and we think that it is a real experiment in late cycle stimulus. if you put large tax cuts and spending increases in an economy that's come this far, it's going call for some kind of response in monetary policy. i'm pretty sure the federal reserve is not going to preempt that. that they are is going to lag behind that. still could be more tightening than we've seen to date. two years, two rate hikes. can you get at least more. >> add it all up. what's your call, stocks, bonds, currencies. >> u.s. dollar assets. we're neutral on u.s. shares. we like u.s. credit. we think that this back up in rates combined with relatively wide spread and incredibly wide yield premium made high rate variable loans look good.

u.s. municipals for those investors that take advantage of that. we have a lot of concern for international assets. >> we got to leave it there. thanks. have a great day. what crical i? wh team spir wor14 what it rth to talk to your mom? what's the vue a walk in the wos? the value of pital is to crte, not ju wealth, buthingshat matter. morgannley

good morning. the march for the dow 20,000. four trading sessions left if the dow wants to that it milestone in 2016, but wouldn't be the end of the world works it? maybe we'll get there eventually. shopping season is not over yet. is it ever? retail bracing for a flood of returns and hoping consumers will open up their wallets when they go in to exchange the gifts. and the reports of brittany spears death have been greatly exaggerated. sony music was hacked, the twitter account and it sent out some fake tweets about the pop star. that's not nice at all. details straight ahead.

it's tuesday, december 27th, 2016 and "squawk box" begins right now. ♪ ♪ right now i'm stronger than yesterday ♪ >> announcer: live from new york where business never sleeps this is "squawk box". ♪ good morning. welcome back to box right here on cnbc. happy holidays everybody. merry christmas. happy hanukkah. i'm andrew ross sorkin along with john kerry and michelle caruso-cabrera. we're back in the saddle. take a look as it's equity futures. the market looks like it will open down just marginally. the dow will open down 16 and a half points. the nasdaq down slightly. overnight in asia hang seng was closed today. the shanghai composite was slightly lower. south korean kospi was marginally higher. in europe london's ftse closed. we